Adherence to Contract-based Work

(1) Adherence to Contract-based Work

Before entering into a business transaction, the specifics of the work to be performed and contract terms must be mutually and clearly understood, and this understanding must be documented in a written contract so that specific points can be confirmed at all times and doubt avoided. All important contract elements like compensation, delivery date, work specifics, scope of responsibility, and ownership of rights must be carefully expressed to prevent differences in understanding between the Company and the other party to the contract. All contracts must remain on file in a secure location for the period of time required by local laws and regulations.

(2) Changes in Contract Specifics

Work must always be performed in accordance with the specifics of the applicable contract. When changes in contracts are required, such as regarding quantities, specifications, delivery date, or place of delivery, those changes must be confirmed in writing and agreed to by both parties.

Appropriate Business Relationships with Business Partners and Cooperating Staff

(1) The Contracting of Work

When work is contracted out ("outsourced"), employees must always remember that such work is really their own work, and must appropriately manage the work. Outsourced work cannot be solely the responsibility of the supplier. Matters that are the responsibility of the employee must be performed reliably based on his or her responsibility. When problems arise, contract specifics must be confirmed, and responsibility divided in a reasonable manner with the supplier. Any problems will be examined in cooperation with the supplier and will be addressed so that they are not repeated in subsequent work.

(2) Prohibition of the Abuse of Dominant Bargaining Position

When the Benesse Group is to be a purchaser of goods or services, all applicable laws will be complied with, and conduct abusing the position of superiority or the making of any unreasonable or unfair demands as listed below must be strictly avoided.

1. Using the difference in the power relationship to force unreasonable conditions on the supplier
2. Forcing the supplier to report on the details of business dealings with other companies in the same business category when such dealings exist
3. Forcing the supplier to unfairly or unreasonably bear the cost of responding to errors
4. Making the condition of a business transaction the agreement to do other business, such as with a related company
5. Preventing business dealings with competing companies without a valid reason following the end of the contract
6. Forcing a supplier to provide on an individual basis money, services, or other economic benefits when a business transaction is extended
7. Unilaterally establishing or changing transaction terms to the disadvantage of the supplier

Appropriate Selection of Suppliers

In the selection of suppliers, a comparison of several potential suppliers should be made whenever possible, and such matters as quality, cost, and other terms should be carefully reviewed. The requirements must be established in a rational manner, and selection procedures must always be carried out fairly. Employees should bear in mind that the selection of suppliers will greatly influence the quality of Benesse Group's products and services. Demands must not be made of suppliers unrelated to selection criteria, and selection must never be based on whether suppliers can meet such demands. To prevent problems from arising after the selection of suppliers, such matters as the supplier's performance capacity, management capacity, legal compliance situation, and credit situation should always be verified in advance of signing any contract. Business must not be done either directly or indirectly with suppliers engaging in forced labor, illegal labor, or illegal child labor. When such facts are discovered, appropriate measures must be taken immediately and appropriate Benesse Group executives notified.

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